Signs point to guilty, says IC

The Institute of Chartered Accountants in
India’s (ICAI) disciplinary committee has agreed with the ICAI
director of discipline’s findings that these parties were
guilty.

The disciplinary committee found Price
Waterhouse Kolkata and Price Waterhouse New Delhi prima
facie guilty of professional misconduct. The Price Waterhouse
firms are all independently registered with the ICAI. Price
Waterhouse Bangalore was Satyam’s external audit firm.

The institute has been investigating the
accounting profession’s involvement in Satyam since an INR7 billion
($1.43 billion) fraud at the software company was revealed in
January this year.

Soon after the fraud was revealed, the ICAI
issued show-cause notices to Price Waterhouse in Bangalore, New
Delhi and Kolkata.

According to Indian media reports, Price
Waterhouse Bangalore named four answerable members: S
Gopalakrishnan and Srinivas Talluri, who were the former auditors
of Satyam; P Siva Prasad, who was the head of the audit team; and
audit team member Ch Ravindranath.

The firms in New Delhi and Kolkata replied
that they were not the auditors of Satyam and, therefore, not
answerable to the allegations.

The four auditors named by Price Waterhouse
Bangalore have all been found prima facie guilty by the
ICAI.

Gopalakrishnan and Talluri signed Satyam’s
audit reports between 2000 and 2008. Both were found prima
facie guilty for failing to carry out statutory audit and for
not qualifying the reports to say the financial statements did not
give a true and fair view of the affairs of the company.

The two Satyam staff members found guilty were
internal audit leader VS Prabhakara Rao and chief financial officer
V Srinivasu. Gopalakrishnan, Talluri and Srinivasu are all
currently being held in prison. The ICAI has issued notices to all
the respondents; written replies must be submitted within 30
days.